Market Potential Of Cosmetics And Toiletry Retailing In Australia: Analysis And Strategies

Background of the research problem

In the present competitive business environment, proper understanding of the market potential is necessary for maximizing the initiated market strategies. Moreover, it would also help organizations to understand kind of revenue it can collect from the market. As a result, it eliminates the risk level associated with the businesses (?opaciuk and ?oboda 2013). Over the years, the needs and wants of the people within the economy changes in a significant manner. For that reason, it induces organizations to evaluate the trend of the market in an in-depth manner. In this study, the focus will be on the identification of cosmetics and toiletry products in the Australian market. For that reason, the study would focus on assessing current market trend or the amount sales occurred in the past few years in Australia. It would help the study to identify whether the market for cosmetics and toiletry products has increased or not. It would also focus on assessing the kind of impact changing tastes and preferences of the customers can have on the businesses of the cosmetics and toiletry retailing. The study would also focus on initiating effective research methodology and data collection plan so that it can able to highlight the present situation about the cosmetics and toiletry retailing business effectively.  

Over the past few years, needs and preferences of the people have changed significantly in the cosmetics and toiletry retailing. As a result, it has induced cosmetics organizations to change the provided products for fulfilling the market needs in an effective manner. From the past 5 years study, it has been assessed that the overall sales volume of cosmetics and toiletry products has increased consistently in the Australian market. However, the sales volume of cosmetics and toiletry retailing has reduced in a significant manner. In fact, it highlighted the fact that Australian people are purchasing cosmetics and toiletry products from the e-commerce companies (ALqadami et al. 2013). As a result, retail organizations have failed to achieve desired sales volume in the Australian market. Moreover, the changing needs and preferences have made previously popular cosmetics products obsolete in the market. Therefore, it has affected the overall business level of the cosmetics and toiletry retailing organization in a major way.

In this study, the focus would be on analyzing the factors that are affecting the overall business level of the cosmetics and toiletry retail organizations. The study would focus on evaluating the decreasing sales volume on the cosmetics and toiletry retail sector. It would also focus on evaluating the kind of impact decreasing sales volume of can have on the cosmetics and toiletry retail sector (Cullen et al. 2013). On the other hand, the study would also focus on the prime factors that are encouraging people to move towards the e-commerce sector in order to fulfil their needs and wants in an effective manner.  

From above problem statement, it can be assessed that retail sector organizations dealing in the cosmetics and toiletry segment is facing challenges in maintain the profit level. Therefore, the prime management problem would be:

• Is it profitable to continue cosmetics and toiletry retailing business in the Australian market?

Problem definition

The above identified management problem has lead to the identification of the following research problem:

• What are the market potential or business opportunities of cosmetics and toiletry retail sector having in Australia?
• How does changing preferences in cosmetic and toiletry products would have create impact on management decision-making strategy?

In order to identify the market potential of cosmetics and toiletry retailing, the study would focus on following objectives:

• To evaluate the present trend regarding the taste and preferences in the cosmetics and toiletry retailing in Australia
• To evaluate market potential or business opportunities cosmetics and toiletry retailing sector in Australia will have in near future
• To analyze the impact of changing needs and wants in cosmetic and toiletry products would have on management decision making strategy
• To estimate the exact amount of adverse impact that popularity of e-commerce platform would have on the business level of cosmetics and toiletry retailing in Australian market
• To recommend the best possible way to enhance the overall revenue level in cosmetics and toiletry retailing in Australian market

Significance of market potential for increasing the revenue level of cosmetics and toiletry retailing organizations: 

As highlighted by Dolatabadi, Kazemi and Rad (2012) proper assessment of the market potential required for initiating effective marketing or promotional strategies. It has been assessed that market potential is positively correlated with the revenue level of the organization. Over the years, people from different geographical location have entered into the Australian market. These people have differences in culture, values and believes compared to the local people of Australia. Therefore, it is expected that it would create major impact on the potential market of cosmetics and toiletry retail sector. As per the article by Twigg and Majima (2014) organizations dealing in the retail sector would have to focus on providing additional benefits to the customers in order to retain them for long period of time. It would also ensure that people does not look for any alternative purchasing options. In addition, proper assessment of market potential can allow organizations to utilize total investment in such a way so that it can able to eliminate the overall risk level. Therefore, it would help to achieve desired amount of profit from the Australian market. It has been assessed that future market potential heavily depends on the present attributes (Opstrup et al. 2015). For that reason, retail organizations dealing in the cosmetics and toiletry retailing will have to initiate effective strategies so that it can increase the satisfaction level of the customers. It will increase the market potential of cosmetics and toiletry products in the Australian market.

As highlighted by Dorman (2013) increasing popularity of internet has provided business enterprises a new platform through which they can conduct business in the global market. In present time, e-commerce has able to establish its presence on all parts of the global market. It has been assessed that e-commerce have increased the convenience level of the customers in a major way. It has allowed people to purchase their desired products from their households, which also have helped the customers to save time (Cullen et al. 2013). For that reason, majority of the Australian people have started to purchase their daily products like groceries and cosmetics from the online platform. It has also helped them to select products from greater alternative options. As a result, Australian people have become more dependent on the online platform, which has affected the retail business of cosmetics and toiletry products. It minimized the overall revenue level that the retail organizations are used to gather from the market. Moreover, impact of e-commerce is likely to enhance its popularity even further in future (Schewel and Schipper 2012). Therefore, it would also increase the challenges associated with the retail business of cosmetics and toiletry products. For that reason, it has become essential for all the organizations working to utilize different strategies in the cosmetics and toiletry products in the Australian market. It would also have to focus on countering the popularity of e-commerce platform in order to increase the potential market in Australia.  

Management problem

As per the article by To, Tam and Cheung (2013), effective utilization of strategies is essential for creating desired impact on the market. For that reason, retail organizations dealing in the cosmetics and toiletry department will help also have to focus on the development of new strategies for enhancing the market potential effectively. Firstly, organizations will have to focus on effective utilization of promotional or marketing strategies for providing in-depth information about the products and services. It would also have to maintain the price level compared to the entire online platform. In fact, it will have to focus on providing products at the lesser price compared to the online platform so that switching cost of the customers from retail to e-commerce platform become very high. It would also have to focus on providing some value added services like free Wi-Fi, cafeteria and other facilities for ensuring regular visit of the people from the potential Australian market. As emphasized by González-Benito and Martos-Partal (2012) value added services can help organizations to develop customer base for future, which is important in creating positive impact on the potential market. In fact, it would also have to focus on quality of the products so that customers do not look for any alternative options. It will also help to increase the market potential for cosmetics and toiletry retailing in the Australian market. It has been assessed that effective utilization of customer services can also create positive impact on the overall potential market in Australia, which is also likely to create massive impact on the revenue level of the organizations.

From the above discussion, it can be assessed that proper assessment of market potential is essential for maximizing the impact of all the business strategies. Now, not many studies have been conducted on the cosmetics and toiletry retailing. Therefore, not enough data is available on the internet platform. As a result, it is very difficult to conclude regarding the exact market potential of cosmetics and toiletry retailing industry in Australia. For that reason, the study would have to focus on using primary data collection approach for fulfilling all the objectives in an effective manner. It would also help the study to analyze trend regarding the future potential market of cosmetics and toiletry retailing in Australia.

In order to evaluate the market potential of cosmetics and toiletry retailing, the study would consider two-stage research design. Firstly, the study would focus on utilizing exploratory research, as it will help to understand Australian people attitudes towards the cosmetics and toiletry retailing. Thereafter, the study would focus on utilizing descriptive research design to identify the prime areas of market that would purchase cosmetics and toiletry products from the retail organizations.

The literature review section has highlighted two prime management problem including decreasing market share of retail organizations and increasing popularity of e-commerce platform in the market (Panneerselvam 2014). For that reason, in order to identify the potential market of cosmetics and toiletry products, the study would first like to explore different new areas. Thereafter it will focus on descriptive research design for fulfilling all the objectives.

Research Questions

The study would focus on exploratory research, as it will have to explore different new areas for fulfilling all the research objectives (Flick 2015). For that reason, exploratory research must diagnose the dimensions influencing attitudes towards the new market potential for understanding the outcome of the study effectively. Moreover, exploratory research design would help the study to assess the opinions, attitudes and feelings of the Australian people towards the cosmetics and toiletry retailing. Therefore, exploratory research would help the study to test the concept of feel of the people towards cosmetics and toiletry retailing. It would also help the study to formulate hypothesis in an effective manner. It will eventually help the study to fulfil the requirements of descriptive research.  

According to Vaioleti (2016) descriptive research design focuses on casting light on the research problems or issues through the utilization of data collection procedure. Descriptive research design helps to utilize the behaviour or characteristics of the sample population. The study would also include descriptive research design to cover all aspect of the research study in an effective manner. It would also help to evaluate the research hypothesis in comprehensively. The purpose of the research study in including descriptive research design is to identify and highlight the variables inducing positive attitudes of the people towards the potential market. Furthermore, effective utilization of descriptive strategy would help the management of retail organizations to initiate effective decisions for enhancing the potential market for cosmetics and toiletry products.

Thus, effective utilization of both exploratory and descriptive research design would help the study to fulfil all the aims and objectives in an efficient manner. In the initial stage, it requires exploratory approach for identifying exact market potential of cosmetics and toiletry in Australia. Thereafter, the study would focus on descriptive approach to capture in-depth information about the research topic. Thus, selection of combined research design is expected to create major impact on the overall outcome. On the Contrary, the study will not select any particular design, as it might fails to cover all aspect of the research topic.  

As highlighted by Silverman (2016) appropriate use of methodology would ensure that required amount data has been collected about the research topic. In order to assess the market potential of the cosmetics and toiletry retailing in Australia, the study would use focus group interview method. It has been assessed that focus group interview is completely unstructured. Therefore, it allow interviewer to ask random questions to the interviewee. The study would select small group individual to understand the insight of the small group of customers. It will also help the study to fulfil all the requirements of the exploratory research. However, the prime objective of conducting focus group interview is to identify the insight of the customers regarding the future trend of Australian market towards the cosmetics and toiletry retailing. The study has also selected focus group interview, as it would help the study to cover all aspect of the research objective within limited timeframe. Now, in order to ensure the quality of the focus group interview, the study would have to focus on moderator, moderator’s guide, selection of the respondents and logistics issues for conducting in-depth interview.

Research objectives

Moderator:

Moderator plays a significant role in keeping the cost associated with the research study in an effective way. Effective utilization of moderator would help the study to capture the actual feedback of the respondents. It has been assessed that moderators can create certain atmosphere where employees can share their thoughts and beliefs freely, which is essential for completing any study (Panneerselvam 2014). Moreover, moderator can also introduce different questions in order to cover all aspect of the research study. Moderator guide help the study to evaluate all the issues in an effective way. It would also provide the flexibility to the respondents in sharing information about the research topic.

Identification and selection of the respondents:

As per the article by Taylor, Bogdan and DeVault (2015), appropriate selection of the respondents is essential for fulfilling all the research objectives. For that reason, the study would focus on selecting those individuals who have the capability of sharing information about the research topic. Thus, the study would focus on non-probability sampling technique for fulfilling all the research objectives (John Kuada 2012). In order to evaluate the market potential for cosmetics and toiletry retailing, the study would select retail managers in Australian market. It would help the study to analyze the changing trends regarding the popularity of cosmetics and toiletry retailing in Australian market.

Number of participants:

As mentioned earlier, focus group interview needs to be restricted within limited respondents. Otherwise, it can create confusion about the outcome of the research study (Neuman and Robson 2012). Here, the study would select 15 managers working in different cosmetics and toiletry retailing in Australian market. The study would ensure that all the respondents must have more than 10 years experience in this sector. Otherwise, it will be very difficult to collect data about the changing trends of the Australian market.

Logistical issues:

Focus group interview generally requires more time, as the study look to collect data about all aspect of the research topic (Smith 2015). Therefore, the study would have to focus on selecting venue, as per the convenience level of the respondents. The study would focus on utilizing 20 minutes time from each respondent so that it can cover all aspect of the research topic. The study would focus on recording all the conversation during the interview process in order to ensure that it can help the data analysis structure in an effective way.    

Data analysis:

As highlighted by Mackey and Gass (2015) selection of data analysis tool is another important aspect of the research study. Here, as the study has focused on utilizing focus group interview, it will have to utilize qualitative data for the research outcome. For that reason, the study would also have to focus on developing questionnaire with open-end questions for capturing all the details about the cosmetics and toiletry retailing in Australian market. 

Ethical issues: 

Proper maintenance of ethical rules and regulations is important for describing the actual situation about the cosmetics and toiletry retailing in Australia (Miller et al. 2012). For that reason, the study would focus on remaining unbiased at the time of data collection. It would also ensure that respondents can feely share their views, thoughts and beliefs without facing any difficulties. Moreover, the study would ensure that the data collected for the study does not use in any other purpose. Otherwise, the study might not able to fulfil all the objectives in an appropriate manner.

Budget: 

Literature review

Table 1: Budget for research

(Source: As created by the author)

Limitation of the research: 

The research study has several limitations that it will have to counter in an appropriate manner. Firstly, the study has to be performed under limited timeframe. As a result, it would not allow the study to cover all aspect of the research topic. Moreover, the study would also have to deal with limited budget, which can also have major impact on the outcome of the research. The study has assumed that all the information provided by the respondents is true, which might not be in reality. For that reason, these factors can have major impact on the overall outcome of the research study.

Conclusion:

From the above analysis, it can be expected that all areas related to the research topic will be covered in an appropriate manner. The utilization of combined research design will help the study to identify the present market as well as future trends related to cosmetics and toiletry retailing in Australia. Therefore, it will able to provide the kind of challenges cosmetics and toiletry organizations will have to face in near future as well. The analysis is expected to highlight the increasing market of cosmetics and toiletry products in Australian market.

References:

ALqadami, A.A., Abdalla, M.A., ALOthman, Z.A. and Omer, K., 2013. Application of solid phase extraction on multiwalled carbon nanotubes of some heavy metal ions to analysis of skin whitening cosmetics using ICP-AES. International journal of environmental research and public health, 10(1), pp.361-374.

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Cullen, J., Tsamenyi, M., Bernon, M. and Gorst, J., 2013. Reverse logistics in the UK retail sector: A case study of the role of management accounting in driving organisational change. Management Accounting Research, 24(3), pp.212-227.

Dolatabadi, H.R., Kazemi, A. and Rad, N.S., 2012. The impact of brand personality on product sale through brand equity (case study: Cosmetic products retailers). International Journal of Academic Research in Business and Social Sciences, 2(11), p.294.

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